🔍 Event Review

Recently, the ETH market experienced a round of intense fluctuations: starting from late at night, the ETH price sharply dropped from a high point in a short time, and after a brief rebound, it maintained a low-level oscillation. The entire process showed a shift in market sentiment from optimism to rapid panic, while exposing the risk of large institutional leveraged positions being triggered for liquidation. The uncertainty of the macro policy environment and internal funding chain liquidations mentioned in the news are the two core factors driving this round of correction.

⏰ Timeline

• 23:04
  The market began to show warnings of long liquidation, exposing the risk of large leveraged positions, laying the groundwork for subsequent large sell orders.

• 23:07
  ETH precisely touched around $2150, achieving a short-term rebound of about 1.5%, indicating that short-term technical support had emerged.

• 23:16
  The uncertainty of policies increased, as the U.S. Senate reconvened to discuss the crypto market structure bill, causing a sudden drop in market risk appetite.

• 23:24
  Analysts issued a pessimistic warning, pointing out that ETH was falling "without resistance" and expected it to test the $2000 level.

• 23:30 to 00:35
  The ETH price rapidly slid from about $2180 to around $2104, a decline of over 3.3%, with a large number of internal institutions triggering liquidation effects gradually becoming apparent.

• 00:50
  After a brief adjustment, the ETH price rebounded to $2124.16, with some technical buying indicating signs of a short-term bottoming out.

🔎 Reason Analysis

Macroeconomic Policy and Economic Uncertainty:
Recent controversies over U.S. government funding, some shutdown crises, and expectations of Federal Reserve policy adjustments have severely weakened investors' risk appetite. Policy discussions, Senate meetings, and regulatory trends have tightened market liquidity, putting downward pressure on both traditional finance and digital assets, which is a significant reason for the rapid withdrawal of market funds.

Internal Funding Liquidation and Institutional Selling:
On-chain data shows that some heavyweight institutions and whales have experienced concentrated liquidation events under high leveraged positions. Large sell orders have continuously emerged, forming a chain liquidation effect, exacerbating market panic and causing the ETH price to drop significantly in a very short time.

📊 Technical Analysis

This technical analysis is based on Binance USDT perpetual contract [ETH/USDT] 45-minute candlestick data, observing the following key features:

• Price Trend and Bollinger Bands:
  The ETH price is moving along the lower Bollinger Band, showing an overall weak trend, indicating that sellers are dominant.

• Moving Average Arrangement:
  The price has been consistently below MA5, MA10, MA20, and MA50, while EMA5, EMA10, EMA20, EMA50, and EMA120 are all in a bearish arrangement. This multi-period bearish layout of moving averages indicates a clear downward trend from short-term to long-term.

• Oscillation Indicators:
  Both KDJ and RSI are in the oversold area; although a local rebound may be triggered in the short term, the overall downward trend still prevails. Meanwhile, the MACD histogram continues to shorten, indicating that selling pressure remains strong.

• Energy and Trading Volume:
  The OBV indicator continues to decline, clearly showing that selling power is increasing. At the same time, trading volume has surged, with a 10-day average volume increase of 136.03%, indicating that market trading activity has sharply increased under severe sell-off conditions.

🔮 Market Outlook

Considering the dynamics of macro policies and technical performance, ETH is currently in a phase where extreme sentiment and overselling are intertwined. Future trends may present the following possibilities:

• Short-term Technical Rebound:
  Due to KDJ and RSI being in oversold conditions, local buying may intervene, achieving a technical rebound. However, this rebound is likely to be short-lived and can only alleviate some panic.

• Continued Downward Risk:
  If macro policy uncertainty and internal liquidation events continue to ferment, and market liquidity remains tight, ETH may further test lower support levels, with some analysts even expecting a test around the $2000 integer level.

• Funding Behavior and Risk Management:
  Investors should closely monitor the movements of large institutional sell orders and on-chain liquidation signals in the market. During periods of intense volatility, it is advisable to adopt a strategy of placing orders in batches and implementing strict stop-loss measures to effectively control position risk.

Overall, ETH currently exposes a dual dilemma of funding tightness and policy risk. The intense fluctuations provide the possibility for a short-term technical reversal while also laying the groundwork for subsequent deep adjustments. For short-term traders, attention can be paid to local technical support levels, while long-term investors should patiently wait for fundamental stability and the restoration of market confidence.

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